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Judgment
PER AMITABH SHUKLA, AM
This appeal filed by the Assessee is directed against the order of Ld. Commissioner of Income Tax (Appeals)/NFAC, New Delhi, dated 23.01.2026 arising out of penalty order dated 29.03.2025 passed under section u/s 271(1)(c) of the Act for the Assessment Year 2016-17. The word ‘Act’ herein this order would mean Income Tax Act, 1961.
At the outset, the ld. Counsel for the assessee submitted that the appeal of the assessee deserves to be allowed in view of the fact that the quantum addition made by the ld. AO through his order u/s 147 r.w.s. 144B of the Act dated 25.05.2023 stands deleted by a Co-ordinate Bench of this Tribunal in its decision in ITA No.4598/Del/2024 dated 09.04.2026. The ld. Counsel submitted that the ld. CIT(A) has also confirmed the same, vide his order dated 23.01.2026, wherein, the assessee had contested invocation of penalty u/s 270A in its case.
The ld. DR places reliance upon the order of the ld. Assessing Officer.
We have heard rival submissions in the light of material placed on record. We have noted that in this case, the penalty for concealment of income u/s 271(1)(c) is resting upon the assessment order u/s 147 r.w.s. 144B of the Act dated 25.05.2023. The impugned assessment order thus becomes the foundation for the super structure of penalty u/s 271(1)(c) built upon it. It is trite law that when the foundation collapses, the super structure cannot survive. As there is no quantum order available, there cannot be any commensurate penalty order also. Accordingly, we allow the appeal of the assessee.
In the result, the appeal of the assessee is allowed.